Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


UPDATE: Fonterra fined $300,000 over food safety failings

UPDATE: Fonterra fined $300,000 over food safety failings in botulism scare

(Adds court comments from the second paragraph.)

April 4 (BusinessDesk) – Fonterra Cooperative Group, the country’s biggest company, was fined $300,000 for breaches of the Animal Products Act during last year’s whey protein concentrate incident.

Judge Peter Hobbs fined Fonterra $60,000 for three separate charges and $120,000 for a fourth charge in the Wellington District Court. The judge took a starting point of $375,000, before mitigating factors including Fonterra’s early guilty plea and steps it took to address the issue, though he lifted the penalty to reflect the company’s size.

“There’s no doubt the flawed reworking process and its fall-out had wide ramifications,” Judge Hobbs said. “I accept, however, the offending resulted from careless failure to follow proper procedure rather than a deliberate or reckless plan – things could have and should have been done better.”

The dairy exporter faced a maximum penalty of $500,000 for not processing the whey protein concentrate in line with its approved risk management programme, exporting dairy products that didn’t meet food safety standards, failing to notify AssueQuality of its concerns, and failing to inform the Ministry for Primary Industries it had exported product not fit for purpose.

Grant Burston, counsel for MPI, sought a starting point of $375,000, with mitigating factors and an uplift to account for Fonterra’s size resulting in range of $300,000 and $350,000. Counsel for Fonterra Adam Ross said his client would accept the decision of the court.

Auckland-based Fonterra released results of an operational review into the incident in September, which showed the contamination had occurred at its Hautapu plant in the Waikato back in May 2012 after workers became concerned a piece of plastic had fallen into a drier.

Rather than downgrade the product it was decided to reprocess the powder, using a non-standard transfer pipe that was thought to be the source of the contamination. The incident led to a global recall of the contaminated product.

That initial incident was compounded by “a number of un-related events in an unforeseen sequence,” chief executive Theo Spierings said at the time. The contamination was ultimately found to be a harmless strain of bacteria.

Fonterra reached commercial settlements with seven of the eight customers affected by the food scare, and is still facing a civil claim by France’s Danone, the parent of infant formula manufacturer Nutricia.

Ultimately, the contamination scare did little to dent global demand for dairy products, which have driven a surge in New Zealand’s export receipts and helped send the terms of trade to a 40-year high.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Land & Water Forum: Fourth Report On Water Management

The Land and Water Forum (LWF) today published its fourth report, outlining 60 new consensus recommendations for how New Zealand should improve its management of fresh water and calling on the Government to urgently adopt all of its recommendations from earlier reports. More>>



Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news